Ex-Newtown Oil owner found guilty

Michael P. Mayko

Updated 11:49 pm, Tuesday, October 9, 2012

NEW HAVEN -- A federal jury Tuesday convicted the former owner of Newtown Oil Co. of conspiring to commit mortgage fraud and committing wire fraud in obtaining a $50,000 loan to complete a house in Westport.

However, 12-member jury acquitted William A. Trudeau Jr. 49, formerly of Norwalk and Westport, on seven charges involving mail, wire and bank fraud following deliberations over three days.

The verdict left a question about how far the jury determined William Trudeau's involvement extends in the alleged six-year-long, $3.5 million mortgage fraud conspiracy.

That's going to be a question for U.S. District Judge Janet C. Hall during Trudeau's Jan. 2 sentencing.

The two charges for which he was convicted each carry a maximum 20-year prison term.

Assistant U.S. Attorneys Rahul Kale and Christopher Schmeisser are expected to maintain the conspiracy conviction covers all eight mortgages on Westport properties and one for Weston.

They claim Trudeau, a property developer, was an unnamed principal in both Aspetuck Building & Development and Huntington South Associaties LLC because of his prior criminal record.

Federal investigators say Huntington South was a shell company through which money was filtered.

However, the jury's acquittal of Trudeau on three counts of mail fraud and two counts each of bank and wire fraud involving the other loans creates a valid argument for his lawyers, James Filan and Ross Garber, in seeking a lenient sentence.

"Our interpretation of the jury's verdict, and the only logical interpretation, is that the jury found him guilty of conspiring to obtain only the $50,000 loan for which he was convicted of wire fraud. He has since paid back that loan," Filan said.

He said the jury acquitted Trudeau of the other seven underlying charges and that the money involved in those loans should not be considered part of his involvement in the conspiracy.

"Convincing the jury to return not guilty verdicts on seven of the nine charges is a big victory," said Filan.

The $50,000 bank loan for which Trudeau was convicted was supposed to be used to complete construction of a home at 9 Fragrant Pines in Westport.

The prosecution claimed Trudeau instead used the money to pay legal fees and rent a summer home in Nantucket.

In the past, Trudeau was found guilty of nine state larceny charges after his now-defunct Newtown Oil Co. failed to deliver $260,000 in prepaid fuel to customers. He avoided prison by making some restitution.

A short time later, he was indicted, convicted and sentenced to 22 months in federal prison for not paying $232,000 in employment taxes for his oil and auto repair business workers between 1993 and 1997.